April 15, 2011

Unlike the Affordable Care Act, which mandated that millions of young and healthy Americans purchase insurance with government subsidies, the Paul Ryan plan would instead bring the oldest, sickest, and least profitable demographic to the table. And with the CBO projecting that the average senior would be on the hook for over two-thirds of their health care costs within just 10 years of the plan's adoption -- a proportion that is projected to worsen in the long run --- the government subsidies backing them up may not bring in enough profitable customers to make things worthwhile.

80 comments:

I agree, I mean what insurance company is going to be able to do anything with $15,000 in subsidy and whatever you might toss in on top? I mean what business could EVER expect to make money from Seniors?

The way it used to work, before somebody-else-pays, was that fees were tailored to the patient.

Rich people paid extra. Hence the very old joke that the most difficult course in medical school was presentation of the bill.

That was all more or less the ordinary course of compassion.

With rules, compassion is a loser's game. Without rules, it's a winner's game. It improves the character.

Liberals are terrified that someday they'll be called on to do something for somebody else. They want the government to shield them from that. There are, after all, no limits in what it might cost them to help.

Seniors are already the ones in medicare, so this won't make medicare any more high risk or expensive than it already is. And it will at least add a bit of competition into the insurance part of the equation. Better than what we currently have, which is almost certain to fail completely. Either we ration our own care (i.e., get us consumers to feel some of the cost of our consumption), or government will ration it for us.

I don't understand the question, Ann. Of course insurance companies will cover them. They will cover them for what their premiums are worth, not for any medical care you want.I have that kind of insurance today. My wife is underwritten for several pre-existing conditions, and we are covered for 80% of those fees, after a big deductible - up to a maximum cap. After that, we do the best we can.Why is this a question? Who do you expect to pay for their care if Uncle Sam no longer can? They will get the care they can pay for.

The wealthiest age quintile in the nation is the oldest quintile. I don't understand why we are horrified that those seniors who have the money should pay for their own health care. The poor? Sure. But most are not poor or anywhere near it. I am happy that well-heeled seniors can travel the country in motor homes and live out their golden years in a condo in Boca. I understand they want to leave their homes and their wealth to their kids, instead of "squandering" it on their own health care. But I don't see why this makes for a compelling moral argument for the rest of the population, who are on average less wealthy, to pay their health costs. Shouldn't they be required to spend their own money first, before leaning on the rest of us?

If insurance companies were allowed to compete fairly and openly across state lines, you could in effect start seeing prices decrease. The Ryan plan includes a voucher system, which I didn't see in the article, or I just missed it, but medicare would still be intact. In fact, the idea itself could bring the uninsured into the fold because the prices would drop through equitable competition. That is the biggest stumbling block that isn't being addressed right now. I should be able to get my health insurance from any company, anywhere in the state or the globe without running into these intrastate brick walls.

I'd more believe Paul Ryan than that lying sack of shit we have as president right now. Even his lies aren't true.

Consider the possibility that substantial subsidization of medical care for everybody over 65 by the federal government is economically unsustainable. And also, consider whether it's really the role of the federal government to do that anyway.

I agree with the liberal critique. If anyone is going to be passing out Death Coupons to ration care, it should be the government and not private companies. Choice is so overrated.

"Sorry, Ethel. We have a finite budget and it's either your colon or a train link between Farmtown and Farmville. No, you can't buy private insurance. We've made it too expensive for anyone to insure you. So long."

Depends -- will the regulations be structured so that the whole risk pool is seniors? Will they be required to accept anyone in the covered age group, at any time, without regard to pre-existing conditions? Will they be required to provide unlimited coverage to everyone in the risk pool?

If so, then companies won't get into the market, because under those conditions it's impossible to manage risk. See, insurance is essentially a bet, and the insurance company is the bookie; if the bookie can't know that the losing side of the bet will be, they won't bet.

On the other hand, the current Medicare system does limit benefits in several ways. Since the current Medicare system receives, on average, less than that $15K annually and suffers from endemic fraud and abuse, then yes, companies will happily offer Medicare replacement coverage.

(The Crypto Jew)A better way to go would have been to increase the Medicare tax from 2.9% to 4% or so and keep Medicare as is for those over 65.

No, no tax increases! That’s what happens, to be nice/moderate/reasonable we raise taxes, but they NEVER go down…and the Ryan Plan doesn’t affect anyone on Medicare NOW, IIRC…it applies to people 55 and younger. I could be wrong about that last, bit.

This whole insuring year to year thing does not make sense. Over the course of one's life, you build up equity in a house, or even similarly you build up savings with a whole life policy- why can't health insurance work the same way? You pay in when you're younger, including some portion for insuring now and then you take out when you're older. Seems easy. Year-to-year insurance for old people makes no sense. In the end, they'll likely require insurers to accept the voucher and insure seniors. Not much different from Medicare now, really.

They should require that these plans be high deductible as well. I'm a free-marketer, but here it seems we need to force a real market that is sensitive to prices by mandate. Sorry, but if you're not self-insuring for $5k or so over age 60, you're a schmuck.

On the other hand, your Medicare tax payments after paying in and working for 40 -45 years should be worth almost $200K [if you include the value of interest income] for someone who makes an average income. That would sustain some hefty premiums for quite a few years of retirement.

The question we forget to ask is "how would you design the system for today's 25 year-olds if we were starting from scratch?"

With Boomers passing away by the time -THIS- plan is enacted it seems -HIGHLY- likely that there will be lots of hospitals, doctors, nurses and nursing homes seeking new customers.

When the market has excess capacity, prices are usually lowered to increase demand. When there is limited capacity prices rise to meet demand. whent govt commands price stability, prices are fixed and demand is lowered to reach the maximum profitability. This seems simple, except to those wage slaves who nurse off-the- public-teat and never consider value for money except when demanding more for being older.

UNDER the present system -WHY- will any new drugs, medical equipment, procedures be introduced-? When the govt sets prices for all drugs, why risk billions on selling a product that will never return it's investment.

Who do you think paid for all the drugs and medical advances these past 50 years-? Who paid for the testing and trials, and reviews-? Who paid for all the spurious lawsuits that reduced any profits to the entire company-? DO -YOU- who think -the Evil Rich- should pay for every whim want to lower the average age for men and women over 55-?

No-? Then HOW will you pay for it-?

We could start the market now by allowing those over 65 to opt-out of Medicare. At the present time, those who have private insurance -MUST- have Medicare approve the drug or operation first then the insurance company will pick-up the rest. BUT if Medicare says "NO." then no insurance company may provide coverage for the drug or procedure.... Why not let the Evil Rich opt-out and buy their own health care-? That would be one way to have more doctors delay retirement, serve only the private pay, and the drug companies to invest in new geriatric treatments... nstead, with a limited and finite market it is in the interest of -BOTH- the govt and insurance companies for people to die younger and closer to their retirement age....

There is no such thing as a Free Lunch or Free Healthcare or Free Retirement. If you think there is, you will prove P.T. Barnum right when he said "There's One Born Every Minute"... He also would be right about the Free Lunch...

P.T. Barnum a man who knew his Democrat/Progressives/Socialists/Fools... Show me I'm wrong...with facts not nasty comments and personal attacks... Show me the market where your wonderland works exactly as you wish.... Show Me

If what you want is to bring the whole system of entitlements crashing down, utterly discredited for generations, don't do what Rep. Ryan and other "reformers" are urging. Because their plans are designed to save the system of entitlements by making it sustainable.

No, the only way to wreck it all beyond salvation is to follow the path being charted by the President and his allies, advocating higher taxes, no significant change in structure, other than a escalating, top-down cost-control. That is the "accentuate the contradictions" path that will smash it all to smithereens.

Anyone who thinks the insurance market as it exists today is a free market is either woefully ignorant or willfully malicious.

I don't know what point this statement is intended to make. It's certainly true that the insurance market is substantially regulated, so in that sense is not "free," but there is (or, at least, was) price competition among providers. Catastrophic-coverage policies were pretty cheap in CA a couple of years ago.

As far as seniors being able to buy insurance, AA, have you ever heard of policies like Medicare Advantage?

Both my parents worked for and retired from the state of California. They had vested enough to retire at 60% of salary. Both didn’t actually retire. They went back to work,…(actually they never left)…half time for half salary. They were now making 110% of salary and only doing half of what they were doing before retirement. Now they are completely retired. They have a combined retirement of slightly more than 120,000 per year for the rest of their lives. They are also collecting additional Social security and med care pays for their health costs. I am a small business owner and made less than 20,000 last year and will make less this year. I have and always will pay for my own health insurance and that of my daughter…and I have to pay taxes so my parents can receive free health care. My point, the elderly are not victims if they don’t get free med care. In fact many, many of these folks should not be receiving any assistance for health care from the government including my parents who long ago paid off their home mortgage and will live very comfortably with out any additional help from the feds. If you’re pulling a hundred grand a year, you pay your own way no matter what your age…and my parents…yes two very progressive liberals who remain conflicted but still accept the leftist indoctrination that someone else should be responsible for the costs of their health.

The Congressional Budget Office, in an assessment last week, said Ryan’s plan “would significantly reduce mandatory outlays for health care” and result in “much lower deficits and debt in the long run.”But the CBO also found that under Ryan’s redesigned Medicare, “most elderly people would pay more for their health care than they would pay under the current Medicare system.” CBO said by 2030 those on Medicare would pay more than twice as high a share of the cost of their medical care than beneficiaries in the current system do./

And...

Under Ryan’s proposal which he unveiled last week:- Eligibility for the existing Medicare program would not change for people who are age 55 or older by the end of 2011.- People who turn 65 in 2022 or later years would get payments from the government to help them purchase private insurance.- The payments would be higher for low-income people and lower for high-income people: people in the top 2 percent of the income distribution of the Medicare-eligible population would receive less than one-third of the subsidy which middle- and lower-income people would get.- The payments for insurance would grow over time in pace with overall consumer prices, but not necessarily in pace with the increase in the cost of medical care.- Starting in 2022, the age of eligibility for Medicare would gradually increase until it reached 67 in 2033.- The federal government would change the Medicaid program for poor people into block grants to each state. Those grants would grow over time in pace with overall consumer prices and population growth.- There would be no tax increases.

Would seniors pay more than they do now for the healthcare? Yes. As they should.

When the Xers and Yers start voting in politicians who will kill Medicare because they know they'll never see anything from it and don't want to be taxed to death to pay for grandma's medical care, Ryan's idea might look a little better.

The Lefties hate it because it takes power out of their hands and says there are some things government does lousy.

Well its a fair question. You can underwrite anything but the cost is what can in the craw. Some Medicare Advantage programs have been profitable even when considering the "extra dollars" put in. The big challenge is changing a mindset in elders that their health coverage is a blank check to one in which they "express" their values in health care consumption via their pocketbook.

A lot of heavy lifting to do, but....

consider the alternative.

Frankly I think Medicare will need to change from an "entitlement" program to a quasi-welfare program.

Mom and dad are 79 and 82. Dad has been self-employed since his mid-50's and only fully retired about 4 years ago (and still does a special project for old clients now and then). They have always paid for their own health insurance plus, because they wanted better care than what Medicare would provide as a baseline, purchase Medicare Advantage... something ObamaCare gets rid of. Cuz it would be much "fairer" if all seniors got the same lousy coverage rather than allowing even the mildly prudent to "profit" from their unfair advantage of being hardworking in their younger years.

BTW, you all do know that you cannot opt out of Medicare, right? Not if you want to see a dime of the money (15% of your earnings over the years of your working career)of Social Security.

It's a reasonable question. There's a reasonable answer. Unless one thinks that the entire health industry would shut down. Note the last bullet point.

"This proposal, A Roadmap for America’s Future ensures a partnership between the Federal Government and States to create State Health Insurance Exchanges with the following benefits:

▫ Establishing High-Risk Pools. State health insurance high-risk pools will offer affordable coverage to individuals who would otherwise be denied coverage due to pre-existing medical conditions, making coverage affordable for those currently deemed “uninsurable.” States may offer direct assistance with health insurance premiums and/or cost-sharing for low-income and/or high-cost families.

▫ One-Stop Marketplace for Health Insurance. Each individuals will get an opportunity to choose the plan that best meets his or her needs through a State-based Exchange.

▫ Benefits by the Same Standard Used For Member of Congress. Plans offering coverage through an Exchange will have to meet the same statutory standard used for the health benefits given to Members of Congress.

▫ Guaranteed Access to Care. The Exchange will require all participating insurers to offer coverage to any individual regardless of the patient’s age or health history."

Not that I'm a "teatard" but I DO know the liberal playbook. STEP 1: increase taxesSTEP 2:reduce payments to providersSTEP 3:-partially undo STEP 2 after feeling political heatSTEP 4:repeat as necessary

1. Supplemental insurance for old folks already does a booming business (except when it's outlawed or severely restricted by the government). Because...

2. Health care providers, last time I checked, make their money by selling their services to sick people.

Hence, I don't understand why folks thing there's going to be a problem. Older people (like younger people) will gladly pay someone to make them healthier. Health care providers will gladly take payment to do it.

Pogo has a big piece of the answer. I spent a lot of time a couple of years ago studying the French system. There are a series of posts if anyone is interested. The key feature is that they preserve fee for service which everyone here says is a cost problem. What it does is keep the doctor and patient the two parties in the transaction. No death panels.

However, when the patient goes to see the doctor, the patient pays first. Not a co-pay, the whole fee. The patient swipes a card in the doctor's office and gets a check from the health plan a week later which is for the amount from the national fee schedule.

The doctor has to post all fees so there is no surprise. The patient can choose the local GP or an expensive specialist in Paris. The health plan payment is the same and the rest is the patient's responsibility.

There is a similar arrangement with hospitals although the plan pays most hospital bills first. The balance after what is allowed is still the patient's to pay. There is co-insurance, like MediGap coverage, and there are co-pays for certain services, like drugs and lab tests.

The fees are lower and doctor's incomes are lower in France but medical school is free and the quality of care in France is excellent. That could be a model for us but Obama went exactly the opposite way.

BTW, you all do know that you cannot opt out of Medicare, right? Not if you want to see a dime of the money (15% of your earnings over the years of your working career)of Social Security.

The one who has to opt out for balance billing is the doctor. The patient can keep Medicare as a last resort if disaster strikes and still get private care from a "retainer practice" internist or a cash practice surgeon.

The busiest (and said to be the best) hip replacement surgeon in Newport Beach CA has dropped all Medicare. What he does is charge, in cash, what Medicare actually pays him. It is about 1/4 of the bill that you see on your EOB. I think it's about $1700 for a total hip now.

"I don't get it" Is this your passive aggressive way of exercising your anti-Ryan hard-on or are you genuinely puzzled? Its not a simple topic so if you think flaunting your ignorance is some kind of statement your head is up your ass. Ryan is just regurgitating the premium support model that has been being bandied about for decades. Anyone who want to understand the genesis of the Ryan and the Ryan/Rivlin proposals might choose to read the old 2002 Kaiser Foundation report on the topic: http://www.kff.org/medicare/loader.cfm?url=/commonspot/security/getfile.cfm&PageID=14147 So if you are opposed to a premium support model of Medicare reform fine. Tell us what you support instead. Just don't stand there and ignore the Medicare funding crisis like that little dufus weasel barry obama or we will lose respect for you.

If the plan is that seniors wait until 65 (or older) to enroll in a plan, cost will become a problem.

On the other hand, if people are in a plan from (say) age 30 or 40, and the loss risk is spread over a broad age spectrum, it could work. You would probably pay a little more at 30 or 40, but for that you are guaranteed to remain eligible for a viable pool with a age distribution that makes it workable.

I believe that under the Ryan plan the poor and ill will be preferred over Warren Buffet who under the Obamacare approach is worthy of the same treatment as the poorest. Ryan will have means testing and other grown up approaches. A budget requires numbers and that is what Ryan has provided. Our president is searching for an Excel program that calculates bullshit and platitudes. I think some Democrat should invent such a program.

Clearly there will be a market for health insurance among those affluent seniors. As I suggested I can see Medicare becoming more and more like Medicaid (i.e. health insurance for low income)

A great future quandry will be long term custodial care. Right now,Medicaid is having severe financial difficulties AND providing the largest chunk of dollars into LTC. About a third of Medicaid dollars are spent on the elderly (Medicare). so putting it painfully and bluntly our elderly are "taking" dollars "meant" for the poor.

So again an interesting "coalition" for Dems; the poor and the elderly. One is "stealing" from the other.

I work for a home health care company and most of our clients are seniors. And most of them have medicare and most of the people with medicare also have some other insurance because there are so many things medicare does not cover...and the people who are indigent receive both medicare and medicaid. I would think that if medicare was phased out, the same people who supplement medicare would still be around and in business.

When I checked a few years ago, 73% of Medicaid dollars went to long term care. That is one model that has to change. The British do a lot of home care but people there tend to move around less, especially the now elderly.

When I was a resident physician at LA County Hospital, they had a program called Home Care. Doctors and nurses would see patients at home and could get lab and x-rays done at patient's homes. That is gone now because the hospital is no longer full.

Later, when I was on the faculty at UC, Irvine, I tried to set up a program to see patients in assisted living facilities. The administrators would set up a small clinic for us and staff it since it was so expensive and disruptive to take residents to doctors' appointments.

Idiots saw that it didn't go anywhere but there are good alternatives like that one. For one thing, health expenses peak at about age 70. After 70, patients become less willing to have expensive procedures. The cost curve is not one that keeps going up. For one thing, those with bad life styles die off. The trouble is the people who design these plans have no experience caring for the elderly.

The busiest (and said to be the best) hip replacement surgeon in Newport Beach CA has dropped all Medicare. What he does is charge, in cash, what Medicare actually pays him. It is about 1/4 of the bill that you see on your EOB. I think it's about $1700 for a total hip now.

I opted out of Medicare this year. My patients get a 20% discount for paying at the time of service. I wish I could do my whole practice this way. I get paid at the time of service, don't have to obsess about writing down every little last thing to prove to Medicare I earned my money, don't have to think hard about how to assign codes and modifiers to submit the bill in a way that will get paid, and don't have to worry about tracking down secondary insurance information. Strangest thing, the patients who opted to stay with me and pay cash are overwhelmingly of modest means. My wealthiest patients all transferred to other doctors, where they can use government subsidies to support their lifestyles. Considering that physician fees are only 4% of the Medicare dollar, I can't see how Obama can seriously believe his Independent Advisory Board is going to save Medicare. The healthcare reform legislation specifically prohibits them from cutting payments to hospitals, pharmaceuticals, or clinical laboratories, so that just leaves physician payments - a very small portion of the pie. Knowing that makes me think he can't possibly be serious about reforming Medicare.

How much do we wqnt to spend on each American for the delivery of medical services after age 70?

$340,000?; $250,000?; How much? How much is enough?

We have finite resources. How much do we want to spend on the elderly's health care? How much do we take away from the young?

Why does anyone think that I am entitled to ask a person living in Madison, WI to pay a share of my medical care costs. When did we enter into a contract whereby he or she became obligated to me to pay a share of my medical care costs?

I propose that we decide upon some flat, fixed quantum that each citizen is entitled to receive from the US government and that the Governemnt can afford to pay. Everybody gets the same amount. Lets make it a flat sum tha tis paid on day one of your eligibility date. Paid in cash and US T-Bonds. After that payment is made, the citizen is no long entitled to receiving compensation from the government. One and done.

The receipiant may purchase medicare services from anyone in any market. When the money is gone the patient is one his or her own.

Wow, a LOT of hatred displayed here towards us Senior Citizens. Of course, its our own fault. We (I) fought in Vietnam, we (what few of us remain) fought in WWII, in Korea and in other places. Oh yeah, I forgot, WE ALSO PAID OUR TAXES too. And we pay, on average, something close to $12,000a year for Medicare. We have in fact CONTRIBUTED something of ourselves to America and NOW some of you want a class war. Well this is one Senior Citizen who relies entirely on Social Security Disability Income and Medicare. And until you can show me WHERE AND HOW YOU PERSONALLY have helped America - in uniform, in the Peace Corps, in any fashion at all, I don't want to hear it. And I AM sorry but a lot of doctors refuse to see me because Medicare doesn't reimburse them enough.Its so nice to see that Medicine has become a business, not a profession anymore.